Challenges of a supply chain due diligence obligation (Supply Chain Act)

Supply chains play a crucial role in our globalised world. Companies face many challenges, particularly with regard to the verification of data due to the Supply Chain Act.

Review, risks and solutions

In today’s globalised economy, supply chains play a crucial role. However, companies are increasingly confronted with the challenges of supply chain due diligence (Supply Chain Act), especially when it comes to verifying data. The facts surrounding the Supply Chain Act audit shed light on various problems that companies have to overcome.

Transparent data sources as the key to integrity

The sources from which data for Supply Chain Act audits originate are often opaque. This uncertainty harbours the risk that the authenticity of the data cannot be clearly established. Companies are faced with the task of identifying reliable and transparent data sources in order to ensure the integrity of their supply chain.

Adapt questionnaires to the legal requirements

Data is often collected using questionnaires in various formats. These often do not exactly reflect the legal requirements, which makes compliance checks more difficult. There is an urgent need to develop standardised and legally compliant questionnaires to ensure that the data collected complies with legal requirements.

Manual verification of data from the social sector

The data to be collected mainly comes from the social sector, such as human rights or child labour. Manual verification of this sensitive data is often time-consuming and error-prone. Companies need to find solutions to automate the process while ensuring the accuracy and correctness of the information.

Complex interactions between companies and suppliers

Companies that are subject to the Supply Chain Act often have several suppliers to be audited, while one supplier in turn supplies several companies subject to the Supply Chain Act. The challenge is that different questionnaires are sent to the supplier, which increases the risk of inconsistent responses to the same legal requirements. Standardised communication and questionnaire design are crucial to minimise these inconsistencies.

Lack of context-sensitive testing

Companies often record data without carrying out a context-sensitive check. This increases the risk of “greenwashing” and violations of the Supply Chain Act, where companies pretend to act sustainably while in reality their compliance with legal requirements is questionable. A context-sensitive review of data is crucial to ensure that sustainability efforts are not just superficial.

Risks of fraud and greenwashing

One prominent example was provided by a well-known car brand based in the south of the country. Despite a successful Supply Chain Act audit of a supplier, it subsequently emerged through third-party research that the supplier was massively violating human rights. The consequences were serious. The risk of reputational damage is very high in the event of a violation. There is also the threat of legal consequences. Non-compliance with the Supply Chain Act can lead to legal consequences, including fines and trade restrictions, particularly in regions where strict regulations apply.

Possible solution

Overall, companies must proactively develop solutions to meet these challenges. The implementation of automated processes, the standardisation of questionnaires and the use of modern technologies are decisive steps on the way to effective supply chain due diligence. The use of AI-supported data analysis and risk assessment solutions are further preventative measures. This is the only way for companies to ensure that their supply chains comply with legal requirements while promoting sustainable and ethical practices.

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Process optimisation in five steps

There are many measures to achieve the goals of digital transformation, such as better customer focus or faster time-to-market. One of the most important is process optimisation.

Definition, meaning and implementation

Digital transformation goals such as greater customer focus, shorter time-to-market or improving product quality require many measures, one of which is process optimisation and therefore an important part of any successful corporate strategy in order to remain competitive.

Why is it important to optimise processes?

But why is effective process optimisation so important? Especially in times of increasing competitive pressure, companies need to continuously review and optimise their processes. This is not only about saving time and costs, but also about taking customer requirements into account. Well thought-out process optimisation enables companies to concentrate on their core competencies and generate long-term success. The use of state-of-the-art technologies, such as the automation or digitalisation of work processes, can also increase employee motivation.

Basics of process optimisation

Process optimisation is based on a comprehensive analysis of existing processes. This identifies weak points and potential for improvement, which can then be addressed in a targeted manner. However, process optimisation is not a one-off project – rather, it is a continuous process. Because even if an optimum result has been achieved, the processes must be regularly reviewed and adapted to new circumstances. In addition, clear goals should be defined. Only in this way can the company ensure long-term success through effective processes.

Goals of process optimisation

The objectives of process optimisation are diverse and can vary depending on the company. First and foremost, it aims to improve the efficiency, quality and performance of business processes. Some of the most important goals are:

  1. Cost reduction: Costs can be reduced by identifying and eliminating waste, bottlenecks and inefficient activities in a process. Automation, reducing errors, shortening throughput times and optimising resource utilisation are the main factors here.

  2. Increasing productivity: Optimised process design enables employees to complete tasks more efficiently and therefore increase productivity. Simplifying processes and reducing waiting times are crucial here.

  1. Improving quality: Minimising errors, standardising work processes and implementing quality controls improves the quality of products or services.

  2. Increased customer satisfaction: Faster response to customer requirements, shorter delivery times and the provision of high-quality products and services lead to more satisfied customers.

  3. Flexibility and adaptability: Optimised process design supports adaptation to changing market conditions and improves competitiveness.

  4. Sustainability: Process optimisation helps to use resources more sparingly and reduce the environmental impact, e.g. by reducing the use of energy and materials.

Procedure for process optimisation

To achieve maximum impact it is important to plan the approach to process optimisation in advance as well as to take into account the specific needs of the company, its customers and its employees when selecting methods and processes. Successful process optimisation requires a clear strategy and committed employees. All stakeholders should therefore be integrated into the change process from the outset in order to minimise resistance within the company.

Step 1: Analyse and document processes

The first measure is to analyse and document existing processes in connection with the entire IT landscape. Changes affect different areas of the company, so it is important to have a precise overview of the interrelationships. Relevant information such as time and resource requirements as well as potential weak points should be recorded.

Step 2: Identify potential for improvement

Weak points or bottlenecks can be identified on the basis of the documented processes. Customer requirements and employee concerns should be taken into account in order to better fulfil their needs. In this step, goals are also defined that are to be achieved through the process improvement, including KPI definition.

Step 3: Develop a strategy

After analysing processes and identifying potential for improvement, it is crucial to develop a strategy. This includes prioritising the processes to be optimised and defining KPIs at process and team level.

Step 4: Take measures for optimisation

Specific optimisation measures can be developed on the basis of the analysis results. This includes deciding on the requirements for the IT architecture, the selection of tools and working methods.

Step 5: Monitor and continuously improve implementation

The measures implemented must be regularly reviewed and adjusted in order to achieve a sustainable effect. Key performance indicator systems show the success and adjustments must be made if necessary. Monitoring ensures that the optimised processes have the desired effect, e.g. in the form of cost savings or higher product quality. New market developments should be taken into account and team members must be empowered to make the best use of the new processes and tools.

Challenges and success factors in process optimisation

However, successful process optimisation can also pose challenges. One of the biggest hurdles is often the acceptance and commitment of employees, as changes to the workflow can cause uncertainty and resistance. Clear communication is an important success factor here. Goals should be communicated transparently in order to get everyone involved on the same page. A realistic timetable for implementation should also be set – after all, complex processes cannot be optimised overnight.

Trends and developments in process optimisation

A clear trend in the area of process optimisation, particularly in the area of production processes, is the automation of processes, for example in the form of robotic process automation (RPA), in order to reduce manual tasks and achieve efficiency gains.

Digital transformation also remains an important topic. Companies are utilising technologies such as cloud computing, big data analytics and artificial intelligence to improve their processes and make better decisions. AI is becoming increasingly important here, just as it is in automation. This is because AI provides data analyses that can be used to identify inefficient processes. This enables companies to react to problems at an early stage and prevent potential bottlenecks, resulting in a smoother and more efficient process landscape overall.

In line with the trend towards digital transformation, agile methods continue to be used frequently and processes are being streamlined according to lean management principles. Customer journey mapping, which incorporates the customer perspective and thus helps companies to better understand and harmonise their processes, takes account of increased customer demands.

In order to meet the increased need for communication, the use of collaboration tools is increasing, as such frameworks enable a more efficient exchange of information between employees and teams, which helps to optimise processes.

Recommendations for future process optimisation projects

However, there are a few key points to consider for the success of process optimisation projects:

  1. Involvement of all relevant stakeholders: To ensure the acceptance and commitment of employees, it is important to involve all stakeholders in the optimisation process at an early stage. This can be done through workshops or regular team meetings, for example.

  2. Use of agile methods: Agile approaches such as Scrum or Kanban can help to promote continuous improvement and achieve faster results.

  3. Use of modern technologies: The use of digital solutions such as workflow management systems or robotic process automation (RPA) enables efficient automation of workflows and helps to increase productivity.

  4. Set measurable goals: Clear objectives with measurable KPIs create a basis for reviewing the success of the optimisation process and making adjustments if necessary.

  5. Continuous monitoring & obtaining feedback: Regular monitoring and review of the optimised processes as well as obtaining feedback both internally and externally are decisive factors for sustainable success in the context of professional process optimisation.

Successful process optimisation

It has become clear that there are a number of factors that need to be taken into account if process optimisation is to be successful. The basic prerequisite is precise knowledge of the process landscape in the company as well as a clear strategy and objectives for implementation, in which the customer and employees should take centre stage. It is therefore crucial that all stakeholders are involved in the process from the outset, as change can only succeed if everyone involved is convinced that the project makes sense.

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Regulatory IT for the Digital Asset & Custody Industry

A rapidly growing digital asset & custody industry presents IT with many regulatory challenges, which are characterised in particular by Dora, MaRisk, BAIT and BaFin.

Between Necessity, Challenges and Future Prospects

The rapidly growing Digital Asset & Custody industry is facing increasing regulation, specifically characterised by Dora, MaRisk, BAIT and BaFin. In this article, we take a comprehensive look at the necessity, the complex challenges and the promising prospects of regulatory IT in this evolving sector.

Need for regulatory IT

The need for a strong regulatory IT architecture in the digital asset & custody industry is based on the complexity and sensitivity of digital assets. Dora creates the framework for digitalisation, MaRisk sets minimum standards in risk management, BAIT specifies the IT requirements and BaFin monitors compliance with these requirements. A solid IT infrastructure is therefore crucial for effectively managing digital risks and meeting regulatory compliance requirements.

Challenges in construction and operation

Setting up and operating such an architecture is not without its obstacles. The adaptation of existing systems, the integration of blockchain technology, the continuous compliance with changing regulations and the consideration of regulatory dependencies when outsourcing banking transactions require expertise and resources. Roles such as compliance managers, IT security experts and outsourcing management experts are becoming indispensable.

Required skills and roles

The skills and roles required are wide-ranging. Compliance managers must keep an eye on regulatory requirements, IT security experts must ensure a secure infrastructure and outsourcing management experts must take regulatory dependencies into account. In addition, blockchain developers are needed to successfully integrate this technology.

Focus on security

The security of digital assets is at the centre of any regulatory IT architecture. Modern security protocols, encryption and continuous monitoring are essential to minimise potential security risks and strengthen the trust of all stakeholders.

Challenges in setting up a blockchain architecture

The integration of a blockchain architecture poses a particular challenge. Decentralisation, smart contracts and the management of private keys require an in-depth examination of technical, legal and operational aspects. The DLT Pilot Regime provides guidance on how blockchain can be integrated into regulated environments.

Blockchain integration into regulatory IT

The seamless integration of blockchain into the existing regulatory IT landscape is crucial. Frameworks such as the DLT Pilot Regime provide a clear guideline on how blockchain can be embedded in a regulated environment. Collaboration with regulators is becoming increasingly important.

Prospects

Despite the challenges, regulatory requirements present an opportunity to improve security and efficiency. By utilising skilled staff wisely, applying security best practices and integrating blockchain technology, companies can not only meet regulatory requirements but also strengthen their position as pioneers in the digital asset & custody industry.

Conclusion

Regulatory IT for digital assets is not just a regulation, but a strategic investment. Organisations that proactively address these challenges will not only ensure compliance, but also create a foundation for sustainable growth and innovation. By integrating blockchain technology and regulatory compliance, the digital asset & custody industry will become a more secure and efficient financial sector for the future.

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The suitable integration platform for your company and your customers

Increasing customer demands, shorter time-to-market and higher requirements for information security and data protection are becoming ever more important. An integration platform provides the solution to many of these challenges.

Information security and data protection are key issues

Not only have customers’ expectations of their providers’ services increased, but environmental influences, which require a greater customer focus and the associated shorter time-to-market, also make it necessary for companies to react ever more flexibly to changes. In addition, at a time when information security and data protection are becoming increasingly important, it is essential to protect one’s own business processes and the data processed in them as securely as possible against unauthorised access. An integration platform provides the solution to many of these challenges.

It can effectively connect data and applications to increase efficiency, improve responsiveness and thus offer a competitive advantage. IT landscapes with complex, poorly networked systems and applications, on the other hand, often represent an obstacle in this context, as their adaptability and scalability are very low.

Integration platform: A definition

But what does an integration platform actually mean? An integration platform is a software solution that enables seamless connection and communication between different components, applications, systems and data sources. It serves as a central interface for collecting, integrating, transforming and exchanging information from different sources.

The main task of an integration platform is to overcome the heterogeneity of data formats, protocols and different technologies. It offers a comprehensive range of tools and functions to harmonise data.

Integration platforms in enterprise architecture management

Ultimately, an integration platform plays a decisive role in modern enterprise architecture management. It is the centrepiece from which all services and applications can be controlled, maintained and exchanged.

The importance of integration platforms lies primarily in the fact that they help companies to manage the complexity of their IT landscape and enable seamless integration and networking of their systems. By using an integration platform, companies can improve interoperable communication between their systems and thus exchange data seamlessly. This enables them to optimise operational processes and workflows, increase efficiency and make better business decisions based on up-to-date and consistent data.

This also makes a significant contribution to improving the quality and consistency of data. By centralising the collection, transformation and validation of data, companies can ensure that all systems have access to up-to-date and error-free data and applications and that data loss can be avoided.

Advantages of an integration platform

There are many examples of the advantages of integration platforms. Here are just a few:

  • Simplifying the integration of applications and data
  • Reduction of complexity and pre-processing of data
  • Increased transparency and visibility of data flows
  • Reduction of integration costs and time
  • Increasing the scalability of the IT landscape
  • Improving the efficiency and speed of business processes
  • Increasing the possibility of automating many business processes
  • Flexibility for rapid adaptation to changing business requirements
  • Better integration of cloud and on-premise solutions
  • Increased security through centralised control and monitoring of data exchange processes
  • Improving data quality and consistency
  • Reduction of time and costs for maintenance and development of interfaces

Choosing the right integration platform / solution

When choosing an integration platform/solution, companies should consider a number of things to ensure that it meets their requirements. Above all, the requirements and functionalities should take centre stage. Which features do the individual stakeholders need, which data formats, interfaces, transaction capability, etc. are involved? It is important to get all specialist departments on board right from the start.

The chosen solution should be flexible and scalable to ensure the easy integration of additional systems and applications. It should also be cloud-capable to further increase scalability and flexibility.

The security of company data and systems should also be a top priority. Accordingly, the platform should have sufficient security mechanisms in place to protect the data from unauthorised access and threats. Compliance requirements also play a major role here.

Last but not least, user-friendliness plays a major role for users in the company. This should always take centre stage when integrating a new solution.

Combination of different integration solutions

Often, a combination of different approaches to implementation can deliver better success than committing to one approach.

By using microservices, individual components of the solution can be scaled independently of each other and are very flexible. The combination of approaches also makes it possible to quickly drive forward the development and provision of new functions and services. In this way, the use of third-party providers offers the opportunity to fall back on proven solutions and save time and development effort.

Microservices can be developed, provided and scaled independently of each other, which enables efficient utilisation of resources. API interfaces also facilitate integration with other systems and services, both internally and externally. By distributing functionality across microservices, failures in individual components can also be isolated and rectified without affecting the entire solution.

The implementation of a solution can be both cloud-based and on-premise.

Application example: Integration along the customer life cycle

Especially for companies that offer their services and products online, an integration platform tailored to the needs of customers is a good way to improve the customer experience and thus increase their satisfaction. As a first step, it is particularly important to take a look at the customer life cycle and all of the steps required to optimise the customer experience. This is because covering all customer-related business processes with the help of a single platform solves several problems at once. On the one hand, the services and products are accessible via a “front door”, and on the other, the processes are easier to customise.

In our case, we are looking at the property universe with its various service areas.

Step 1: Integration of all external and internal stakeholders

In this case, it is important that by analysing the needs of all users and partners involved a system is created that meets everyone where they are. In the case of a property platform, both external and internal stakeholders must be taken into account, each of whom has a different view of the application.

Step 2: Automation of processes along the value chain

After analysing all of the stakeholders’ needs, it is possible to break down very precisely which service they require at each step of their customer journey. The integration platform with a front end to the customer is a best practice example of customer centricity.

Step 3: Initial situation IT infrastructure and IT systems

Companies often still struggle with data silos or disconnected applications. On the one hand, this prevents a smooth process, there is a risk of data loss and security gaps, and on the other hand, it is not possible to guarantee a satisfactory customer experience.

Step 4: Combination solution for integrating systems

The solution to this problem is obvious: with the help of microservices, applications can be replaced step by step and connected to the front end via API interfaces if a service or process needs to be customised. This significantly shortens time-to-market cycles, allowing the company to react flexibly to new challenges.

This is also in line with the principles of agility, which provides for an incremental approach and continuous adaptation of services in the interests of a high level of customer centricity and further contributes to ensuring a company’s competitiveness. In addition, the automation of many processes and the high scalability of the application make it possible to utilise the resources freed up to expand business activities, for example by entering markets in other countries and adding further services to the range, and to generate more revenue.

Enterprise architecture with an integration platform for greater customer satisfaction

The example of the real estate platform along the customer life cycle has made it very clear that it makes sense to take a closer look at your own IT landscape in order to find a better solution if necessary. It can also be valuable to take a closer look at which platform actually suits the company in order to use the technologies and developments that are best suited to its own business processes and thus possibly even play a pioneering role in terms of customer centricity on the market.

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"There are many myths and misunderstandings about AI"

There are many myths and misconceptions about AI. Alexander Vocelka, international expert on AI and senior advisor at think tank, talks about the opportunities and possibilities of AI.

AI is the topic at the moment. As is often the case in such cases, there are many myths and misunderstandings about it. Could you explain in a few sentences what AI is?

AI is a learning system created by humans. It starts with very simple systems that can recognise patterns, so-called Narrow AI, and goes up to systems that can recognise their environment and processes in it and react to them in a targeted manner.

 

In principle, AI systems are best understood as cybernetic systems. They have a sensor system through which information flows into them and a computational core on the basis of which the information is processed by mathematical models.  

 

AI systems have passive output systems, such as screens or speakers, or even active motor technology that can operate physical infrastructure, so-called OT (Operating Technology), or a body of its own, as in factory robots or even just the mowing bot for the lawn. The highest form of AI is the so-called General AI, in reference to our human intelligence, which includes very many sensory and several motoric dimensions.

With AI systems, the information is of course digital in nature. They usually need large amounts of data (big data) to be trained in a batch job. The “dirty secret” of the AI industry today is labelling. A large number of people, especially for visual AIs, have to meticulously analyse and categorise the input data, i.e. the images and videos, which is called labelling.

 

"Human ability to make decisions based on small amounts of data still unrivalled."

The human ability to learn and draw conclusions on the basis of very small amounts of data, so-called delta learners, is still not possible for even the most up-to-date systems. An interesting branch of development in this area is edge intelligence, which will play a decisive role in connection with the IoT. There is currently heated discussion about the extent to which AI should control operating technology such as energy supply.

It is important to understand what AI cannot do today: It cannot understand and it cannot feel. Understanding is the basis for complex storylines and responsible action. Feelings are the quintessence for awareness and evaluation.

Understanding is the upcoming big leap in AI that will be truly revolutionary. Emotions are a “Hard Problem”, as science says, and simulation especially for evaluation seems possible to me, pure emotions like animals and we humans produce will probably not be feasible with silicon-based machines.

AI offers many opportunities for companies? Where do you see the main ones?

The honest answer would be everywhere. Of course, there are priorities that derive primarily from the company’s business. Here, I basically classify into two types of business models that have different AI relevance. One is for companies that produce a physical product and those that offer services. In the case of service companies, the major AI potentials are found in portfolio optimisation and in the customer journey, plus the usual efficiency gains in the operating model. For manufacturers of physical products, the greatest AI potential often lies in the product itself, for example in the autonomous vehicle, but of course in every other product. I can’t imagine any product or infrastructure part that will remain stupid.

In the business case of AI solutions, we very quickly talk about 100s to 1000s of % ROI per use case. No other IT investment can come close to offering such a high ROI!

If we look at the individual industries, the greatest potential is clearly in the medical field. Humans are super-complex physiological systems and all new diagnostics and therapies will require massive use of AI. Tools like CRISPR and gene therapies depend on AI. Healthy human longevity will not be possible without AI.

That is why AI as the 4th factor of production is also the most powerful and the fourth industrial revolution in my eyes is the AI revolution.

What areas of application do you see in concrete terms? And what requirements does a company have to meet in order to implement AI in a meaningful way?

Apart from the intelligent products I just mentioned, I see very easy productivity potential in production and quality optimisation. It is astonishing that more than 90% of the AI potential has not yet been captured.

Logistics in general is a single potential. It is astonishing that the logistics experts themselves think there is little potential. I could see for myself that the old simplex thinking blocks are a big problem here. Everyone can think for themselves whether the service we get from airlines, railways, ships and especially road transport is already optimised, or whether an incredible amount of inefficiency is the order of the day here.

In the area of information security, one can rely on intelligent ICS and compliance systems or AI cyber defence. If you look at the area of service, customer service optimisation is predestined for the use of AI. In addition, AI should of course be used in all operational decision-making processes to maximise ROI. Predictions or pattern recognition without automated decision and action are less than a tenth of the rent of AI projects.

In order to use AI effectively in the company, an AI strategy is needed, and the best way to develop one is to understand and describe the company as a cybernetic system. Then you not only recognise the AI potentials, but also understand how they must be connected.

Once you have the AI strategy, you can derive the individual initiatives and projects from it, prioritise them and implement them. Everything is connected in AI.

Where do you think many companies stand today? What are the next stages of development?

After almost 10 years, many companies are still in the process of developing many individual, small separate use cases. There are now many data lakes, but the yield is very low because there is a very heterogeneous understanding and acceptance of AI in the individual company divisions. The individual AI solutions float detached as islands from each other in the data lake. The island existence of AI is even worse than the silo existence of classic IT!

Last but not least, there is also a lack of user acceptance in the company itself, more than with customers or partners, which in turn is due to the lack of or very heterogeneous understanding of AI and diffuse job fears, which in turn stem from a lack of understanding about AI even in the company management. There is hardly anyone who can give conclusive answers in the field of AI and communicate AI strategies consistently. 

And that brings us to the lack of AI governance in companies. This lack then inhibits data generation and integration. Knowledge is power and sharing data is often perceived as a personal loss of control for managers.

Another hurdle is a gap in understanding between IT and business or data science. In addition, the IT that takes over the realisation of AI in companies today is trimmed to operational efficiency and not to innovation. Bridging these gaps is an important task for IT consultants.

You spoke of the company as a cybernetic system? Where and how do people still have a place in this world?

In the medium term, I see a very fruitful collaboration between humans and AI systems emerging, in which humans find their role as teachers and AIs as apprentices. The main task of humans in the medium term will be to constantly train, optimise, monitor and coach AI. The development from High to Low and No Code shows us this path.

We will no longer need programmers, but simply experts who will guide the AIs naturally, via natural human communication.

We will also have many intelligent systems that have different strengths. Even the weaker ones will be able to learn from humans. This means that the human and the machine will work together very closely. The machine will not replace the human being, but the human being will change his role. Every human being is by nature a teacher, coach and supervisor, because humans, like most animals, are programmed to develop learning natural systems themselves – their children. It is the task of AI specialists to recognise this and to develop AI systems in this direction, as delta learners.

A lot of energy is spent on making the systems humanoid. But this is contrary to human sensibilities. We feel more comfortable when we recognise who we are dealing with than when we are obviously and even badly deceived.

Our pets don’t have to look like us for us to accept and love them. We are capable of personalising and loving things – hence the term car lover. The human brain is so powerful that it personalises AI systems on its own without being presented with a bad homunculus- that seems rather creepy to us!

Back to the topic of AI governance. What are its tasks?

AI governance has the task of being able to realise the great potentials of AI while at least minimising negative effects. What is often misunderstood is that AI governance has a limiting function. AI governance must be a balanced framework that enables the maximum potential of AI to be realised and negative impacts to be minimised and mitigated. It has an educational function for all stakeholders. AI governance thus accelerates the development of AI in the company, as it provides security for all stakeholders. At the same time, it should be part of the corporate social responsibility of every company and thus form the basis for a responsible approach to AI.

AI is not going away and there will be no more AI winter. Instead of keeping the topic nebulous, it should be described openly and realistically and AI governance should be equally clear and open. Then fears become knowledge and understanding and that in turn becomes solutions for the future.

AI is the 4th and most powerful factor of production and we are only just beginning to even recognise what potential we have.

Content

Creating added value for companies, employees and customers

Agile transformation is not an end in itself. Its main purpose is to create added value for the company, its customers and its employees. A corporate vision can help drive and steer this change.

Think big: Why a vision is so important

Buzz words like digital or agile transformation are buzzing around in many heads. But why should companies deal with this and what does a shared vision have to do with this topic? The objective of both is to create added value for the company, the employees and the customers and to remain competitive in a world full of disruptions.

Advantages of a corporate vision

First, a brief clarification of terms: The vision describes a desirable state in the future to which employees can orient themselves. This so-called North Star shows where to a company would like to develop. At the same time, it serves as motivation and as a basis for decision-making for the entire organisation.

In its external presentation, the company distinguishes itself from its competitors through its vision of the future and can present how and for what it stands and works. However, it is crucial that the vision inspires and engages everyone. But how is it possible to develop such a rousing vision of the future for one’s own company or to sharpen an existing one?

Approach and methods

At the beginning, as with every process, there is an analysis of the current situation. In targeted interviews, employees at all levels have the opportunity to express their views. This approach offers the advantage that large parts of the staff are integrated and a more comprehensive picture of the company emerges.

In cross-hierarchical and -functional workshops, e.g. using the Walt Disney method, the six hats or the future workshop, the new image of the future can be developed together. The conscious use of creative methods opens up the space for new possibilities to leave the usual paths.

Because as Einstein already said:

 

“The definition of insanity is: doing the same thing over and over again and expecting different results. “

Vision and agile transformation

But what does a vision have to do with agile transformation? By comparing the current state with the vision, it becomes clear what the company can already achieve in terms of existing working models, processes and culture and where the gaps are.

It thus forms the basis for initial ideas to plan the necessary measures for the agile transformation. In addition, a common goal can help to ensure that staff and management accept and want to help shape the changes that every agile transformation brings with it.

Objective agile transformation

One of the primary goals of agile transformation is to make a company more resilient and competitive. This is achieved by simplifying processes and organisational structures in agile organisations, allowing the space for rapid decision-making within the framework of self-organisation.

This also requires a new form of leadership that promotes and demands a high degree of teamwork and self-organisation. What is needed here is not only situational leadership, but the strong leadership form of leadership in which the supervisor shadows, supports and coaches the team. This in turn leads to an increase in the level of innovation and employee engagement as well as responsiveness to changes in the market or in customer needs.

Of course, this contributes greatly to customer satisfaction and thus secures the future of the company. However, it is clear that such a far-reaching change as the agile transformation must be well planned and accompanied in order to empower both management and employees to shape it and drive it forward.

Image of the future as a positive driver

So a clear vision brings many benefits, both in general and in terms of agile transformation. The biggest one, however, is that the focus on a common goal that everyone wants to achieve together bundles a lot of positive energy and decisions are supported by everyone. In this way, every company takes an important step towards a future that enables long-term success.

 

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Agile transformation in the banking environment

Agile transformation requires a high degree of willingness to change. Awakening this in all those involved is not easy, especially in the banking environment, and often requires external support.

Challenges and solutions

Change is difficult for most people. However, the hurdles are often particularly high in very traditional companies and in the banking environment, even though the knowledge that a change towards digitalisation and agility is inevitable has become established in this sector. However, there are a number of things to consider when introducing agile working.

Stakeholder analysis and hands-on training

The most important thing is to identify and meet all stakeholders in a first step, for example in the form of a stakeholder analysis. In this way, they can be convinced of the necessity and feasibility despite the many regulations that exist in a banking environment. Because the agile transformation can only succeed if there is a willingness to change at all levels. This is especially true for the management level, where, as in many industries, a classic understanding of leadership still prevails.

For external consultants who accompany this change, it is therefore particularly important to create a basis of trust. This can be achieved through successful communication on the part of the consultants as well as practical training, in which not only the know-how but also the practical approach is conveyed and its advantages made clear. Intensive training in advance also results in a better understanding of agile work from the outset. Ultimately, however, it is the constantly improving results that provide the best arguments.

Coaching and team building support agile transformation

An important tool for supporting the agile transformation, especially in banks, is coaching, in which old thought patterns can be softened in order to increase acceptance for innovations. This is particularly important because prior knowledge on the topic of agility can vary greatly and individual employees therefore have different attitudes to it. Through group or individual coaching, consultants can also bring employees to a common level.

Since new teams are often created during agile working, team building measures are essential from the beginning to strengthen trust among each other on the one hand and to work together on the new working model on the other. Because agile working works differently in every company and should and must be shaped by the employees. This also means that solutions are developed by consultants together with the employees and the management.

Support from external experts in new roles

If management is involved in the process and also in the training sessions from the very beginning, the risk of a blocking attitude from this direction can be successfully prevented or at least minimised. Conflicts within the team or with the management can be recognised more quickly and can also be solved better.

In addition to good preparation of the team and management, it makes sense to bring in experience in the form of external support, for example as a Scrum Master, in order to introduce the necessary processes and empower the employees to shape the change themselves. Because every change needs time and support. What this looks like varies from case to case, of course.

In conclusion, it can be said that agile transformation can make a lot of sense in the banking environment, especially in IT applications. The prerequisite for this is that the special circumstances in the banking environment are taken into account and that the introduction of new working models and processes is prepared and accompanied accordingly.

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Nearshoring in Tunisia: Is it possible?

Nearshoring in Tunis

Six reservations reassessed

A lack of skilled IT staff and lower costs are only two of the reasons why many companies outsource their software development to a nearshoring partner. The choice often falls on Ukraine or Poland. There are still reservations about countries like Tunisia. Are these justified?

Many companies in Europe are now using nearshoring partners to outsource their software development or entire business processes due to the lack of skilled IT staff and high labour costs. The classic choice is Poland, Bulgaria or Ukraine. But locations such as Tunisia are also becoming increasingly important in this context. However, there are still reservations about non-European partners, which can easily be refuted, because nearshoring in Tunisia also offers many advantages.

Quality training and geographical proximity

Quality: In Tunisia, higher education is of high quality and absolutely comparable with Western European countries. 240,000 students graduate from higher education each year, of which 20,000 are engineers and scientists and 9,000 are information and communication technology graduates. Tunisia has more than 50 engineering schools that teach computer science, among other subjects. This guarantees high quality in the implementation of software projects.

Distance: Even though Tunisia is located on another continent, the time difference is a maximum of one hour in summer and a flight takes only a little more than two hours. Thus, in contrast to offshoring in countries like India, it is guaranteed that contact persons are available during European business hours to make arrangements or solve problems.

Multilingualism and stable infrastructure

Communication: Large parts of the Tunisian population speak fluent French, English is taught at school from grade 4 and there are certified as well as professional language institutions for the German language. In the technical professions, French and English can be assumed, and German and Italian are often added. The local distance can be bridged without problems thanks to digital means of communication, which have developed even further during the Corona pandemic. The good telecommunications infrastructure, in which Tunisia is a leader in the southern Mediterranean, also contributes to this.

Mentality: Without question, there are differences between the German and Tunisian mentality. However, companies like think tank Business Solutions now have decades of experience in implementing numerous projects with European partners. A German bridgehead consisting of product owners and IT consultants additionally guarantees that the cooperation with the customers runs smoothly.

Hands-on mentality and cost savings

Management: Managing a project is always challenging, especially when a hybrid, multinational team has to be managed. To ensure the smooth running of a project, an agile working model is a good choice, which has also become popular in Tunisia, especially in the development and implementation of software in companies like think tank. By having German colleagues manage the projects, it is ensured that the customer’s requirements are always in focus. The developers in Tunisia also have a “get the job done” mentality just like their colleagues in other countries and act in a goal-oriented manner.

The best of both worlds

Costs: Tunisia is also a very good alternative in terms of costs. The hourly rates for a Tunisian employee are attractive and competitive. Despite the good quality of the labour market, the average wage costs for a full-time employee, for example, are very low compared to Eastern European countries, making Tunis an attractive North African location for business process outsourcing. It should not be forgotten that with Tunisia we are in a politically stable area, whereas in the Eastern European area there have been tensions and uncertainties in recent times.

Overall, it can be said that Tunisia as a nearshoring partner is a good alternative to the classic Eastern European countries. In combination with a German bridgehead, which can act as a translator not only of culture but also of mentality if necessary, one is relying on the best of both worlds: Availability of skilled labour, cost savings and German know-how and quality.

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Success through quality, budget control and time management

Erfolg durch Qualität
In the interview series for our 20th anniversary, Lassaad Ben Jamaa talks about the cooperation with Munich and the success factors for think tank.

Communication decisive criterion

How did the idea of founding think tank Tunis (TTT) come about?

We, Lassaad, Mohamed, Hammouda and Yassine, already thought during our studies in Germany that we would like to give something back to our country, since Tunisia made it possible for us to study in Germany through a scholarship. We also wanted to stay up to date technologically. We also saw how much potential there is in our home country. The education is very good, there are many good graduates and engineers looking for work. That’s why the think tank was founded in Tunisia in 1998. We wanted to transfer the German model here, the discipline, the way of communicating, and since we also wanted to do projects in Germany, we then opened a location in Germany in 2002, which has since become the headquarters and bridgehead to Europe.

You work closely with the Munich office. How does the cooperation work?

We know each other very well, we have also worked together in Germany, so we had a personal level. In principle, it was just a continuation of the cooperation with a different local distribution. What was and is important to us is the mutual respect that characterises our cooperation. In addition, we implemented the same working model at both locations, because of course there are differences in mentality. Germany pays a lot of attention to processes, everyone has their defined tasks. We have adopted this here in Tunis in order to be able to deliver the proverbial German quality. Overall, we see ourselves as a German company with three important values: quality assurance as well as precise time management and strict adherence to the budget.

Decisive for a successful cooperation is, of course, communication and exchange among each other. In the past, we used to communicate a lot on a personal level; there were weekly meetings and frequent trips to Germany. I was present on site at least three to four times a year. In addition, there were and are regular coordination meetings at all levels, be it with the management or the sales team. We are also in constant exchange at the project level. For the daily exchange, we have our dailies to receive all information in time and to guarantee transparency. With time and the development of new technical possibilities, we conduct most meetings online. But still today there are regular visits of staff from Tunis to Germany and vice versa, as the personal level is simply hard to replace in the long run.

How has TTT developed since its founding?

In 1998 we started with one developer, then there were two. The number of employees has grown steadily. At first, we only hired developers. With the expansion of our range of services, it also became necessary to hire specialised staff, starting with product owners, scrum masters, DevOps developers and ending with sales and HR staff.

What do you see as the most important reasons for the successful growth?

The most important is, of course, quality. Then there is our flexibility and availability. We are able to react very quickly to our customers’ requirements. In addition, we have meanwhile built up a great deal of expertise in many areas such as e-government processes or also finance as well as automotive, so that we are not only an IT service provider, but can also contribute our specialist know-how. This allows us to offer everything from a single source, which is often very important, especially in the public sector. In addition, we have proven to be a very reliable partner.

What are TTT's greatest successes?

I am very proud of the well-known clients we have been serving very successfully for years. We are also proud of the fact that we have already won several tenders from African governments, such as the project in Madagascar, which makes it easier for investors to obtain loans. Our reputation is now so good that the Tunisian Trade Registry approached us after the new bidder, who actually won the tender, failed to implement it. We were then still able to complete the project successfully. Our office building, from which our logo is visible from afar as a trademark, is also very important to me as a visible sign of our growth and success.

What are the focal points of your work?

We want to focus on three levels. First, it is important for us to strengthen ourselves internally, to further consolidate structures so that cooperation continues to be successful. To this end, we want to optimise and adapt our processes even more so that we can continue to implement projects on time, with high quality and within budget in accordance with our goals. Our growth also makes it necessary for us to strengthen ourselves in terms of sales in order to build up an even larger sales pipeline. The third factor is that we always want to use the latest technologies, so we are constantly looking at and adapting our portfolio to meet the needs of our customers.

What do you value in your employees? What do you offer in return?

Of course, quality training is very important to us, but it should also be a human fit, they should live our values and be committed. People who are not ambitious will not get anywhere with us. Our employees should love their job, have fun and be passionate about their work and not just see it as a salary provider. In return, we offer a salary in line with the market and try to design the premises so that everyone enjoys coming and can work comfortably. We also offer quiet corners and other relaxation facilities. We try to do more than the standard in terms of team events and training. Our staff register their needs for these and we try to facilitate them when it fits our strategy. For example, there were English classes, as this is extremely important for communication with the Munich location. In principle, you can say that we always try to see the person in the employee.

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"Our goal: To grow together with the bompany".

Berufseinstieg
Jihen Koubaa and Sonali Parkash started their professional careers at think tank. In the fourth interview on the occasion of our 20th company anniversary, they talk about their career paths and their experiences of starting a career at tt.

Jihen Koubaa and Sonali Parkash on their career start at tt

think tank is the first "real" employer for both of you. What was it like starting out?

Jihen: I started as a working student in 2012 after studying business administration in Tunisia and attending an eight-month German course.  I started in the media editorial department of a client, but I always had a Master’s degree in mind. However, the tasks at think tank were so varied and interesting that I decided to stay. I was able to try out different areas and activities in several projects with a wide range of colleagues, from software testing and project assistance to project management and IT consulting. For me, this is one of the important advantages of a medium-sized company like think tank: you can discover a lot, a special feature at tt is that you are not tied down and can develop further.

Sona: I started during the Corona period directly after my business informatics studies. At the beginning, I was able to enjoy a bit of office time. Since I had done an internship at BMW, I was able to get directly involved in a project. This allowed me to get to know different roles and perspectives right away and thus acquire or expand my broad professional knowledge. In the process, I also discovered completely new passions. During the Corona period, we all worked remotely, of course, but the team still got along very well. When we saw each other in person after more than a year, it was as if we had known each other forever. It was important for me to have a good mentor by my side who was always there for me personally and professionally. What I liked most about tt was that everything is very informal and the colleagues are understanding. Everything can be handled flexibly in coordination with the client, so I also quickly learned to work freely and independently. I was able to try out new things and was also allowed to implement my own ideas.

What is your development path like? How has think tank supported you and helped you along the way?

Sona: In the beginning, I mainly worked on projects. Now I have a clearly structured development path with annual interviews. However, this path is not fixed, it can also be adapted through short official channels if I justify the changes well and, of course, it they are in the interests of the company. Personally, I don’t want to commit to one role, I want to remain broadly applicable, which is supported by tt. My primary goal is to continue my training as an agile coach, but I would like to remain operationally active. I am supported on my way by my team leader and my mentor. They are always available for questions, and when it comes to specialist topics, I can turn to the experts from the departments.

Jihen: There is always a tandem partner in the areas you work in that you can always ask. The hierarchies are flat and I have worked in various projects and thus acquired a broad range of expertise. I also always had the chance to further my education in training courses and thus take on more tasks. You always get support from the team leader or, earlier, from the division manager and, of course, from the HR department when it comes to further development. Personal preferences are taken into account.

What makes working at think tank special for you?

Jihen: We can express our opinions and they are taken seriously. We treat each other with respect.  The work-life balance is great, there is always understanding, which is very important for me as a mother with a small child. The possibility to work remotely and to arrange my work flexibly in consultation with clients and colleagues gives me a lot of freedom. I also like the fact that you can develop and implement your own ideas. But that requires a lot of initiative.

Sona: The management always accommodates me when it comes to implementing my preferences. The self-organised work gives me the freedom that is important to me. Many colleagues have become friends. That way I have fun at work and can master everything. We also transfer this to the clients. We form a team with the clients and tackle everything together. We take the client by the hand, if necessary, and accompany him from start to finish and don’t leave him out in the cold at any point. It is important, however, that you are also proactive and that you think about and commit to your own development.

You already have experience through internships etc. with other employers. Are there any differences and if so which ones?

Jihen: I have only done internships. At think tank, I have gradually been given more responsibility in line with my individual development. What’s important for me is that I got to know the working cultures in Tunisia and Germany. That way I can sometimes build a bridge and get more involved.

Sona: I got to know the difference between a corporation and a small, medium-sized company. The hierarchies are much flatter, of course. There are also fewer employees. That’s why I don’t feel like a small “cog”. At think tank, I have had more responsibility from the start and my decisions have a greater impact than in a company. In return, I also have more influence and must and may actively participate.

What do you particularly like about your work, in terms of content and personally?

Jihen: I like the fact that I can control my work and make many decisions independently, sometimes I just work as a team member and sometimes I take over the project management for our projects. I also like the fact that I now work as a tandem partner or mentor for new colleagues, that I can pass on the knowledge I have gained and that I learn something new myself at the same time. I also experience a lot of appreciation at think tank; we all meet as equals. I appreciate a lot that we are constantly growing, which offers me new opportunities for further development.

Sona: I like that I have such different activities, that I work together in external and internal teams. The mix of operational and organisational / management topics excites me. My expertise is important and noticed and very much appreciated.

If you could wish for something, what would it be?

Jihen: I miss the on-site appointments. It would be nice if we could visit the client maybe once a quarter. It’s different to feel the atmosphere at the customer’s, it leads to new ideas and more exchange. And that we grow even more, so that I can also grow and take on other tasks.

Sona: I would like the fun to remain in the work. For me, a healthy mix of on-site and remote is important. And I also want to grow with the company.

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